Hello EP.
The verdict information is a good starting point since that information is what insurance companies and the attorneys who file suits against them rely upon when they determine settlement values. If verdicts are generally high and most cases are successfully prosecuted settlements are higher and more common than if verdicts are generally low and most cases are defensed.
It would be nice to have the information concerning settlements, of course, but that info is not readily available and will likely not be ordered released by any regulatory body. The insurance industry is, with the possible exception of big oil, the most powerful lobby in this country. The information they release is released for their own benefit. If the "dropped claims" supported the claim that they were getting hammered by settlements, I suspect we'd see some numbers on that, but we don't.
What we do hear through their PR depts and the "informational" flyers that come in the mail with our every higher bills is that lawsuits are out of control and that they're forced to raise their prices in response. We don't hear that over the last 2 decades they've made record profits, that their recent losses have resulted from a falling stock market and the resulting losses on their investments, that they're inefficient and have no reason to change because we're forced to carry insurance and they don't truly compete in many markets and that they've fought effective reform every step of the way.
It's the same spin techniques that we now see more clearly in the political arena. They raise their prices and blame the price rise on those who make claims. That deflects the anger of those paying higher bills away from the industry and toward those who try to collect from the insurance companies. This, in turn, poisons the atmosphere in court and results, on average, in lower judgements. It also helps them get limits on awards from legislatures in state after state...not a bad strategy but we shouldn't ignore what's really going on.
There are some egregious examples of fraudulent claims and out of control verdicts but the "common wisdom" that our legal system is running amuck is laughably ridiculous. Most juries in most jurisdictions are just as conservative as the American public and they exercise common sense and good judgement. The proof of that is that insurance companies virtually NEVER waive a jury. They want cases tried in front of juries and they understand that juries many times will award less than what the insurance company considers the value of the damages.
That doesn't mean, however, that the insurance companies don't publicly decry the jury system, claim they're getting hammered and spend millions of dollars distorting the facts of and publicizing any case they think might "prove" that they need to raise prices and get legislative protection.
What's surprising is that we never seem to figure out that companies that continue to raise prices may be doing so for reasons other than they "have to." Ed |
